The reality is that the benchmark is 4.25 now and that’s continuing to go up.

@Jack ZhuangInstead of waiting for the "right" timing, set a bench mark that you are OK buying and stick to it.....

What benchmarks do yall use?                                             

What benchmarks do yall use?

It seemed we would return to a more normal market, but now that the FED is playing with the numbers again and has made their recent cut to the benchmark rate I would expect the next 12-24 months to remain steady as they are now.You can go back and look at the records for 100+ years and you will find that real estate is cyclical.

The draws will be after the contractor completes some benchmarks on the rehab.

Apply your benchmarks with the same stringency you used for your last deal.MG

@Stan F.My first thought is that if you are aiming for 6-7% , you will likely get less (there is always unknowns and happenstance in real estate) And at less than 6-7% , you are way better off from almost every point of view investing in the sp500.From my point of view, the whole goal is to crush the sp500 (that’s always the baseline/benchmark comparison - see Berkshire annual reports for last 50 years) In real estate, if organized correctly, you can crush the sp500. 

@Ben Leybovich while I agree that revenue and CapEx are largely uncorrelated, I think the metric is an effort to create some sort of benchmark that you can manipulate based on the specifics of the deal. 

If the roof was replaced a year before you bought the place, and the ac is 18 years old, I'd budget for new ac (which is my benchmark in AZ).Regardless, I would highly discourage underfunding reserves and lean towards having more than you'll probably need.